Markets recover poise as Fed prepares to meet

LONDON - The mood in financial markets
turned more upbeat Tuesday, following days of turmoil for stocks and emerging
market currencies, despite expectations of a further monetary tightening from
the U.S. Federal Reserve.

In recent days, investors have fretted
about slower economic growth in China, the world's second-biggest economy, as
well as the impact of political problems in countries like Argentina and
Turkey.

"The rout that has rocked global
equity markets in recent days appears to be drawing to a close," said Joao
Monteiro, an analyst at Monex Capital Markets.

In Europe, the FTSE 100 index of
leading British shares was up 0.4 percent at 6,579 while Germany's DAX rose 0.7
percent at 9,418. The CAC-40 in France was 0.8 percent higher at 4,177.

The Fed's stimulus, in its various
guises, has helped shore up a number of emerging market currencies over the
past few years as investors looked for higher returns.

Investors are awaiting the outcome of
a two-day Fed meeting starting Tuesday that will be the final one chaired by
Ben Bernanke before Janet Yellen takes over. The consensus in the markets is
that the Fed will announce a further $10 billion reduction in its bond buying
program to $65 billion as the U.S. economy continues to improve.

The more stable market mood began
earlier in Asia. Though most stock markets posted losses, they were largely
modest aside from Australia, where the main S&P/ASX 200 fell 1.3 percent to
5,175.10 as investors had an opportunity to catch up with global declines
following a public holiday there.